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How to deal with aggressive competition?


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#1
Browneyed1989

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A few weeks after I started with an airline, another airline appeared at the same hub with basically the same idea as I had.

 

The airline is opening flights on literally every route I have. And not just some flights, but enough flights to gain the full market share on the specific route. It's one of those spamliners with hundreds of planes and hundreds more on order.

 

When I lower the prices in the morning to gain some market share back, a few hours later this airline lowers the prices again. It's an ongoing process and it's not fun anymore to play this game.

 

Is there a way to deal with this kind of aggressive competition? I have an airline in Russia, which means that I can't open routes that are completely outside Russia.



#2
Danny Guero

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Nope. Spamliners are the worst Man. Cant do much about them. I have faced a few because I like to play a bit more realistic in a sense with my IFS and such but against Spamliners I stand no chance.

#3
SUJETO

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Well , depending of my airline objectives i fell in a aggressive competition with some big airlines, small or starting.
 
¿is it funny? depending.
 
You first, must study the competitor airline to know

  • What are their coverage zone and their HUBS?
  • Is the CEO very active?
  • What is the most used and most profitable airplanes of the competitor airline?

1 Some big airlines dont matter about of NON-TOP airports. AS example all airlines use ATL in USA, you will have hard competitors there always. You can look other airports in the airport list of you country.(In the exmaple) you could look for  MCO  in USA. If you are staring you definitively need to start in a MED size airport. 
 
You could insist in TOP traffic airports but is so time demanding. And could be some capricious CEOS. Some CEOS dont matter about profit in those routes. 
I usually desist of rough competition routes. 
In some cases i insist only to low the prices enough to make it unprofitable then quit as war strategy. Big airlines with a lot of routes usually dont note when someone quits of the route and the ticket prices are low.
 
Check their favorite zone, I noticed all airlnes have favorite zones. And always are small free route spots for profitable routes.
 
When i start a airline i avoid competiton 90% of the time because low profits. I enter 
 
2 If the CEO is not very active i recommend you insist in those rutes... There are (half of cases) old big airlines with no competitors in a while, they usually dont adjust ticket prices. 
If the CEO is very active (your case) you have a problem because he is checking the red numbers in the routes list very often.
 
This link could help you to ckeck red numbers in your routes  ONLY if they change from green. ANd valid only for Y class.
http://ae31.airline-...asc&arr_dep=all
 
Some CEOS are active for 1,2,3 months, there are seasons where are full activity after that boom of activity usually they left less attend their airlines. 
The TOP airlines are ACTIVE always in most cases.
 
3 Check what is the most used plane to know what kind of passager volume he uses.
A lot of BIG AIRLINES use BIG PLANES, to make BIG profits.
Maintaining a routes and competitors below red line is time demanding. If a determined airline uses a lot of 747s . You could try routes for 737s  or other lesser size aircraft. 
 
- - - I checked you profile and you own a BIG AIRLINE. ranked #24.. 
http://ae31.airline-...ae3r0&player=57 (valid only at the time of this post)
 
You manage a REAL a like AIRLINE ,, that is more harder because you must maintain real and popular routes.
 
If you own a BIG AIRLINE you will deal without no escape with competitors. But you have some advantages:
- You have money to buy profitable planes.
- You have other income from other routes.
- You own GATES and TERMINALS with preference (this is hard to get for new airlines and it is costly)
- You may have strong alliance and bonus profits from connections. 
 

Take in mind ... Small airlines have more time to take care of their routes than you.. they always have that advantage.

There are dirty competition tricks ALSO :D  i rarely uses.
 

[,,.] and it's not fun anymore to play this game.[,,.]

Dont say that.  Competitors happen in real airlines man. And there are famous airlines and famous cases around the world because are strong competitors.

 

I told you : i avoid routes with rough competition. but arent all routes. I have my style to play with competitors i dont feel frustrating. I feel in same cases challenging. Is a matter of time. And a little psychological game, to exhaust the enemy with non profitable routes with less ticket prices. For they is time consuming to keep out the red numbers. You could attack with less frequency , your enemy will use their time to check more quicker that is good for him (yeah but) is time consuming, time that he could use to do other things. Time that dont use to bother you.

When i have a BIG AIRLINE i show the competitors "I AM THE BOSS HERE". and is satisfying when they go bankrupt or let inactive their airlines. (75% of the times in my experience) (Note: I did play with humans)
If the competitors are hard fighting for a route that i want: i usually left a small quantity of planes to maintain the route but with standard prices.

 

I hope your situation goes better.


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#4
Book Siberia

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You can pretty much negate (make irrelevant) a competitor on a route by turning one of the endpoints of tht route into a hub, and then reset the price to full price.  Chances are that you will retain close to 100% of the passengers (though some portion of those passengers will be blue (i.e. half-the ticket-price passengers)  In this way you will never suffer huge passenger losses no matter how many passengers the other airline has or how much they lower their price.  However,due to other airlines adding and dropping routes, you will occasionally have to reset the price to re-establish 100% passenger capture on a route.

 

As for how expensive it supposedly is to turn an airport into a hub,  carefully note that purchasing a hub is not an expense - a hub is an asset (i.e., you swap one asset - cash-  for another - a hub).



#5
KJS607

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The best way is penetration pricing.


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